Since the first rental units were built there
have been property managers, a profession which
requires both real estate expertise as well as a
keen understanding of the human psyche. Property
managers not only collect the rent and undertake
repairs, they are also the bridge between owners
and tenants -- two groups often in conflict.
But have modern times changed property
management? How does management today differ
from 10 or 20 years ago when there weren't
electronic credit checks, computerized
accounting systems, or online resources for both
tenants and owners? Is it really possible that
in the near future we'll lease properties and
pay rents online?
"Things are always changing, and yet
they still remain the same," says Howard M.
Haberman, the vice president for sales and
marketing with ReManage,
a major supplier of property management
software.
"The property manager's function is to
manage the lease agreement and maintain the
physical property, that often involves fixing
things that break. Sure, we now have the Pilot,
notebooks PC's, and lots of tools, but the job
isn't much different.
"On the other hand," he continued,
"since the tools have become more complex,
the professional manager and the entrepreneurial
property manager may be required to have a
greater technical knowledge than in the
past."
Haberman points out that automation can free
managers from repetitive tasks, which means more
time is available to work with tenants, vendors
and owners.
"As simple a thing as posting the
monthly rent charge to the tenant ledger card
takes time," says Haberman, who has an
extensive background in accounting. "It can
be replaced by a keystroke that will post from
one to thousands of rent charges
automatically."
Haberman says that the bookkeeping aspects of
property management are fairly straight-forward
-- until it comes to do taxes and handle large
numbers of units.
"If it were not for the tax
requirements, much of the accounting, especially
for smaller ventures, could be done on the back
of an envelope," says Haberman.
Owners with small properties, says Haberman,
those with 8-unit strip malls or four-plex
apartment units, can often satisfy their
bookkeeping needs with a basic accounting
system. The cost of such software can often be
quickly recovered in the form of reduced
accounting fees.
On the management side, a simple software
system can offer several benefits.
- Track maintenance and work orders. This
saves the property manager time and assures
that needed work will be completed.
- Improve maintenance. Properties need
constant maintenance. When maintenance is
deferred or ignored, future costs of
ownership increase and tenants are less
satisfied.
- Reduce the chance of paying invoices
twice.
- Tracking bills to know which vendor is
least expensive.
- Most importantly, respond quicker to
tenant problems -- thus improving
tenant/resident attitudes and bettering
retention rates and lowering vacancies.
"One of the things automated (computerized)
systems do well is add and compare," he
says. "They're a natural for budgeting and
tracking.
Unfortunately, says Haberman, many of the
larger management systems have become so complex
that many owners and managers can't take
advantage of sophisticated options. Even today,
some large property owners and managers still
user older, DOS-based systems, because such
programs do basic management and are easy to
understand. Because the old systems are in use
and often work well, managers ask, "what
additional benefits can I get with new software
that I do not get from my current system, and
will the new software be able to incorporate the
data from the system I now have in place?"
"With rare exceptions, most people I've
spoken with over the years, when looking for
software for a commercial situation, will
require that the program does complex CAM, CPI
and other additional rent calculations," he
says.
"They'll reject software that is more
limited in that functionality. Invariably,
however, a year after what they would consider a
successful implementation, they're not using
those features they demanded, and are
calculating the additional rents on the same
spreadsheet they've been using over the
years."
"One of the benefits of a simple program
is that you'll use it," Haberman explains.
As well, he says, simple systems make sense
because new people are always entering the
field.
"Turnover is a reality in any business,
and certainly so in the property management
field. The simple program is easy to get
up-and-running, and consequently is easy to
teach the new person. The complex program takes
more time to implement, and takes time to train
the new arrival."
In the future, says Haberman, we're likely to
see more landlords relying on electronic
funds transfers, or EFTs, both to collect
tenant rents and to pay vendors who supply
services to the property.
ReManage 4.1, the company's latest
management tool, runs on desktop, LAN, wireless,
and Internet technologies. In essence, the
system can use just about any medium to screen
potential tenants, pay bills electronically,
schedule repairs, and keep the books.
And in the near future, it wouldn't be
surprising if the system also collected rents
directly from tenant bank accounts.
"We're just beginning to see the use of
electronic funds transfer for automatic
repayment of rents," says Haberman, who
suggests that in the San Francisco Bay area --
where rents are high, the availability of
residential units is low, and many tenants
routinely use computers -- owners may be among
the first nationwide to routinely collect rents
electronically.
"The Internet is really going to be a
major factor over the next few years. Won't it
be nice to have the prospective tenant go to a
web site, and drop in the personal information
required, as well as their credit card
information to pay the credit check fee, and
automatically, the credit report gets
transmitted to the landlord?"
"Even better, wouldn't it be nice to
have that information delivered to the
landlord's property management system?"
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